Will This Year's Olympic Medals Be the Most Expensive in History?

British Double Olympic Gold Medalist Rebecca Adlington shows her medals from the 2008 Summer Olympics held in Beijing, China.

Precious metal prices have fallen sharply from last year’s highs, but that certainly won’t dampen Olympic athletes’ spirits when they receive the prized medals in London over the next couple of weeks.

Even though gold is 15 percent below its record high from last year and silver has plunged 38 percent from its own 2011 high, prices of both metals remain relatively high. As a result, this year’s gold medals are some of the most expensive Olympic medals ever produced.

Despite its name, today’s Olympic gold medal is composed of significantly more silver than gold. The medal must contain at least 6 grams of gold and typically has a silver content of 92.5 percent. In fact, the silver in this year’s gold medal is worth more than the gold that plates the medal. Olympic medals have not been made out of solid gold for 100 years — the last ones cast using pure gold were awarded at the 1912 Stockholm Olympics.

This year’s gold medals are worth about $640, based on the value of their gold and silver bullion content. That’s $165 more than the gold medals awarded two years ago at the Vancouver Winter Olympics, despite this year’s medals being nearly 30 percent lighter. So why the sharp increase in value? Since the Vancouver Games, gold prices have jumped 45 percent and silver prices have soared 77 percent.

While they are lighter than the record 576-gram medals at Vancouver, this year’s 412-gram medals are just over double the weight of the 200-gram medals awarded in Beijing four years ago. They are also the heaviest medals ever awarded at any Summer Olympics. Because of the enormous difference in weight and the steep rise in bullion prices, this year’s gold medal is worth nearly 150 percent more than the medal awarded at the 2008 Beijing Olympics.

At $640, this year’s gold medal costs roughly about the same price as a 16GB 4G iPad, which retails for $629.

Of course, the potential monetary rewards of becoming an Olympic champion far exceeds the $640 valuation of this year’s gold medal, or valuation of a gold medal from any Olympic Games. Depending on the athlete, winning Olympic gold can translate to sizable sponsorship or endorsement deals. Alternatively, gold medals sold on the open market would certainly carry a significant premium to the market value of the actual metals that make up the medal.

Note: The value of previous Olympic medals is determined by the medal’s weight and metal futures prices from the day of that Olympics’ Opening Ceremony. All prices are in nominal terms and not adjusted for inflation.